Jordan gets $76m loan to hasten bank reforms

The Abu Dhabi-based Arab Monetary Fund has approved a $76 million (Dh278.9m) loan for Jordan to undertake important financial reforms that include bank stress tests and setting up a credit bureau, the central bank governor said yesterday.

The governor of the Central Bank of Jordan, Ummaya Toukan, told the state news agency Petra ahead of travelling to Abu Dhabi to sign the loan agreement yesterday that the disbursement of the funds was tied to implementing the three-phased plan.

Jordan's monetary authorities have strengthened supervision of the country's banking sector since the global downturn to reduce financial vulnerabilities by boosting capital adequacy ratios, liquidity and installing "early warning" systems.

The AMF loan would be paid back in four years in five equal instalments every six months, the governor said.

Since 1983 and 2009, the AMF has extended 16 loans to Jordan worth $350m to support the treasury and another $411m to fund trade between Arab countries.

He said the Central Bank does not plan to change the composition of its foreign exchange reserves worth $11 billion due to the euro's weakness.

"It will not change. I do not think countries should rush to take such important decisions on daily rates," he told reporters after signing the loan agreement in the UAE.

"We will see for one or two years before taking action."

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